Reality

Venezuela’s hyperinflation is reaching its final stages. It is probably already far too late for the government to stop the complete collapse of its currency. The bolivar is in the process of transforming from a medium of exchange to tinder for wood-stoves. Venezuelans who had the presence of mind to convert their savings into gold or foreign currency in good time are likely to survive the conflagration intact. Governments never seem to learn. They all believe they can somehow overrule economic laws by diktat. This is not only true of Venezuela’s government, but of practically every government in today’s world. Central planning of money has been adopted everywhere. Venezuela merely shows us what the end game for every fiat money system looks like.

"The modern financial animal is wont to assume that he or she lives in an age of science. The truth is we live in an age of pseudoscience. Far from dealing in science, central bankers, and, to a degree, investment bankers and security analysts, employ magical thinking... For an individual to fix Libor is a crime. For a central bank to suppress European bond yields is an act of financial statesmanship..."

Tehran, Beijing, Moscow, Islamabad, and New Delhi have been actively establishing interlocking security guarantees. They have been simultaneously calling the Atlanticist bluff when it comes to the endless drumbeat of attention given to the flimsy meme of Iran’s "nuclear weapons program." And a few days before the Vienna nuclear negotiations finally culminated in an agreement, all of this came together at a twin BRICS/SCO summit in Ufa, Russia -- a place you’ve undoubtedly never heard of and a meeting that got next to no attention in the U.S. And yet sooner or later, these developments will ensure that the War Party in Washington and assorted neocons (as well as neoliberalcons) already breathing hard over the Iran deal will sweat bullets as their narratives about how the world works crumble.

Nowhere is this new "glamour" bubble more visible than in the divergence between these "sexy" names built up on nothing but hype, or as David Einhorn would call them "story" stocks, and good old "resource" companies: those engaging in such "old economy" activities as energy and materials.

Across the board commodities are weak again today as CCFD unwinds and mal-investment booms collapse across the world. Copper is under the most pressure today, plunging to its lowest since June 2009... but of course, Dr. Copper now knows nothing about economics because eyeballs trump reality in the new normal... even as Goldman warns lower prices are to come.

Who could have possibly seen this coming?Almost three years we first detailed how America has become an entitlement nation where "work is punished." It appears President Obama is about to discover this first hand as his populist 'raise the minimum wage' strategy is showing yet another major unintended consequence. On the same day as New York acts to mandate a $15 minimum wage for fast food workers, Seattle's $15 minimum wage law - which is supposed to lift workers out of poverty and off public assistance - has hit a snag. As Fox News reports, evidence is surfacing that some workers are asking their bosses for fewer hours as their wages rise – in a bid to keep overall income down so they don’t lose public subsidies for things like food, child care and rent. So not only is work 'punished' it is now 'disinentivized by mandate' as part-time America toils amid ever-rising costs of living.

One of the many destructive myths Americans like to tell themselves is that the U.S. government is a staunch defender of human rights and democracy around the world. In reality, nothing could be further from the truth.

"My faith is that governments and central banks will continue to run up debt and debase currencies until a crisis brings the whole experiment to a disastrous conclusion. There is simply no historical precedent to reach any other conclusion. I also have faith that human beings will always prefer a piece of gold to a stack of paper. Separate a paper currency from its perceived value and you just have a stack of paper and ink. However, if they would just print it on softer and absorbent stock and put it on rolls, it might have some intrinsic value if we run out of toilet paper."

Richard Nixon made hay of the term “Silent majority” back in November 1969 to defend his Vietnam War policy. It has since been used by American politicians to legitimize and expand the nature of a non-descript huge following they claim as their own, quite often asserting the existence of magnified populism and an implied democracy. Nixon’s baton seems to have been now passed to Donald Trump, as he submits his candidacy for the highest political office in the land, and grabs the microphone to broadcast his unfiltered stand on immigration. A message that questionably-qualified experts in the media are quick to devour, then defecate, on a public more receptive to shallow issues dealing with celebrities than anything of social significance or depth.

When we discuss an "economic collapse," most people think of a collapse of the financial markets; and without a doubt, one is coming very shortly. But let us not neglect the long-term economic collapse that is already happening all around us. If you stand back and take a broader view of things, what has been happening to the U.S. economy truly is quite shocking. The following are 12 ways that the U.S. economy is already in worse shape than it was during the depths of the last recession...